Suit Seeking to Stop Expatriates’ Tax Policy Gets New Date

A Federal High Court sitting in Abuja Thursday adjourned hearing in a suit seeking to stop the implementation of the proposed expatriates’ taxation regime to March 5.

The adjournment made by Justice Inyang Ekwo followed a request by the counsel to the Minister of Interior, John Otuka, who sought time to correct errors in their counter affidavit opposing the plaintiff’s motion for an interlocutory injunction.

The plaintiff, Incorporated Trustees of New Kosol Welfare Initiative, filed the suit marked FHC/ABJ/CD/1780/2024 against the Minister of Interior, Dr Olubunmi Tunji-Ojo, and the Attorney General of the Federation and minister of Justice, Lateef Fagbemi (SAN), as 1st and 2nd defendants respectively.

Represented by a team of lawyers led by Paul Atayi, the plaintiff sought an interim injunction restraining the defendants from implementing the proposed expatriates’ taxation policy, called the Expatriate Employment Levy (EEL), pending the determination of the motion on notice.

The plaintiff’s Programme Implementation Coordinator, Raphael Ezeh, disclosed in an affidavit that on February 27, 2024, the Federal Government unveiled the Expatriate Employment Levy (EEL).

The policy, according to Ezeh, mandates companies employing expatriates to pay annual taxes as follows:

“For every expatriate on the level of a director — Fifteen Thousand United States Dollars ($15,000.00) equivalent to Twenty-Three Million Naira, by the current exchange rates (NW23,000,000.00) per annum

“For every expatriate on a non-director level – Ten Thousand United States Dollars ($10,000.00) equivalent to Sixteen Million Naira, by the current exchange rates (N16,000,000.00) per annum,” he said.

Ezeh averred that the federal government also planned additional regulations consisting of penalties and sanctions for non-compliance with the proposed taxation regime.

According to him, inaccurate or incomplete reporting will attract five years’ imprisonment and/or N1 million.

He said failure of a corporate entity to file EEL within 30 days is to attract a penalty of N3 million, failure to register an employee within 30 days will also attract N3 million, while submission of false information will attract N3 million.

The coordinator said failure to renew EEL before its expiry date by an organisation is to attract a sanction of N3 million.

Ezeh described the policy as “anti-people,” arguing that its implementation would harm Nigeria’s economic growth and stability. He further argued that taxation is a sensitive issue requiring collaboration between the executive and legislative arms of government, as stipulated under Section 59 of the 1999 Constitution (as amended).

Recalled that some few days ago, Justice Ekwo ordered the defendants to appear and explain why the policy should not be restrained.

At the hearing on Thursday, Atayi expressed readiness to move the plaintiff’s motion for an interlocutory injunction.

But Otuka, representing the Minister of Interior, differed, explaining that although they had filed a counter affidavit, it contained errors in the heading, prompting a request for adjournment

A development that Justice Ekwo frowned at, saying, “You filed a counter affidavit against a non-existing originating summons.”

Otuka, in his defence, also explained: “It was a mistake, my Lord.”

At the proceedings, the AGF’s counsel, Enoch Simon, also confirmed receipt of the plaintiff’s documents and disclosed that they had filed a memorandum of conditional appearance, a counter affidavit, and a statement of defence.

He added that they intended to file a preliminary objection but were still within the filing period.

Atayi, who expressed concerns about tampering with the subject matter of the suit, prayed for the motion to be heard immediately.

Justice Ekwo directed both defendants to file all necessary processes at least seven days before the next adjourned date.

He stated, “Parties are hereby ordered to file all relevant processes seven days before the next hearing date.”

The judge also emphasised that any application ripe for hearing would be addressed on the next adjourned date.

He subsequently adjourned the matter to March 5, 2024, for further mention.